Building Fixed Capital
Fixed capital by types of assets divided by the building and construction, machinery, equipment, vehicles and equipment and others. According to this classification are distinguished and the kinds of investments in fixed assets. Investment in buildings and facilities is the cost of construction of these facilities. Costs consist not only of payments for construction work, they also include other capital expenditures, for example, costs for the facility to operate, that is, the organization of communication within the facility, and others. Investment in accommodation costs are for construction of buildings for permanent human habitation.
Such buildings part of the housing stock. These include not only the apartments, as well as various facilities for children, nursing homes, boarding houses, dormitories and so forth. Also, investment may be made in those dwellings that do not part of the housing stock. Investments in machinery, equipment and tools, vehicles – the cost to purchase the above-mentioned objects, their assembly and installation, commissioning, testing reliability. In addition, investment in fixed assets include cash, invested directly in the production itself. Investments in production can be classified according to their investment objectives. There are investments that are going to replace worn out equipment or to upgrade an existing but significantly outdated. By volume of such investments can be compared with depreciation and amortization.
They retain The amount of capital, but not reduce it. Another type of investment is invested in production for its development, improve the scientific and technical level. They can be extensive and intensive, depending on the orientation. AND the last kind of monetary investments made in stocks, for example, raw materials, supplied products and more. In addition, investment in fixed assets can be classified according to their orientation. Distinguish investment invested in new construction and investment, aimed at organizing the reconstruction and modernization of existing facilities. Another characteristic that can be classified as investments in fixed assets, is their funding sources. So as a source may make their own or borrowed funds.